Retailer-branded payment cards continue to proliferate worldwide, but the biggest growth opportunities are in Asia and Latin America, where penetration rates remain relatively low, according to a new report from Finaccord Ltd., a London-based financial services research and consulting firm.

The firm conducted a survey throughout the first half of this year involving 6,280 “prominent retail brands” in 65 countries and found that 30.1% have some type of payment card associated with their brand, up from 27% that did in a 2008 survey.

Among the consumer payment cards retailers worldwide are offering, 72.7% are credit cards; 13.8% are reloadable prepaid cards; 12.2% function as either a credit card or as a reloadable prepaid card, and 1.3% are debit cards. (The survey did not measure retail-branded gift cards.)

Proprietary or private-label retail cards accounted for about 40% of survey respondents’ payment cards, the firm found. The other 60% of retailer payment cards were available either only as cobranded products (mainly with MasterCard and Visa) or as both cobranded products and private-label cards.

Countries with growing populations and low retail card penetration rates present the best growth opportunity for new retail card programs, Alan Leach, a Finaccord director, tells PaymentsSource.

“India, Vietnam, Russia, China and Latin America are all areas with growing populations that have relatively low retail card penetration rates and much growth potential because their populations are shifting from shopping at basic shops and street markets to traditional retail formats,” Leach says.

Only 11.5% of Russia-based retailers have payment cards, while India’s penetration rate is 11.4%, followed by Vietnam at 10.5%, Turkey at 7.5% and Saudi Arabia at 2.3%.

Turkey is unusual because most major retailers there are affiliated with bank-owned coalition loyalty programs, which dilutes the rationale for developing standalone retail payment cards, Leach notes.

Developed nations have higher penetration rates of retail payment card programs, led by Brazil at 76.5% and followed by Canada at 70.3%, Peru at 57.9%, Portugal at 56.6% and the U.S. at 52.9%.

Fuel retailers are most likely to have payment cards associated with their brands, with 71.6% of the world’s most-prominent fuel brands tied to a payment card. Department stores are second at 59.7%, followed by home-improvement merchants at 38.6%, computer retailers at 38% and supermarkets at 37.4%.

The data suggest room remains for growth of various types of retail payment cards in many markets, Leach says.

“Retail cards are fairly mature in more-developed nations, but there is still room for growth there within certain categories,” he says.

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